Christopher Shays: “I rise in support of H.R. 525, the Small Business Health Fairness Act. This legislation would allow small businesses to…”

“I rise in support of H.R. 525, the Small Business Health Fairness Act. This legislation would allow small businesses to pool their resources into what are known as Association Health Plans, AHPs, to purchase health insurance. Pooled alliances, including AHPs, help control health care costs by permitting individuals to use their collective bargaining power to win cost concessions from insurance companies. These alliances also achieve economies of scale for administrative functions--substantially cutting overhead costs, which currently amount to between 30 and 40 cents of every premium dollar paid by small businesses to insurers. Purchasing alliances have been a popular response in many States to the problems many self-employed and small business owners have had securing affordable health insurance for themselves or their employees. While I sensitive to the concerns many disease advocacy groups have about this legislation, the fact is this legislation provides the same exemption from State benefit mandates for small businesses already enjoyed by large employers. The cost savings from avoiding benefit mandates has been estimated to be between 4 and 13 percent. This could make a huge difference for small businesses looking to offer their employees health insurance. Because small businesses are extremely cost-sensitive, studies indicate that even a 5 percent reduction in costs will result in a 10 to 15- percent increase in small businesses offering health insurance.…”